IDEAS home Printed from
   My bibliography  Save this article

What about coal? Interactions between climate policies and the global steam coal market until 2030


  • Haftendorn, C.
  • Kemfert, C.
  • Holz, F.


Because of economic growth and a strong increase in global energy demand the demand for fossil fuels and therefore also greenhouse gas emissions are increasing, although climate policy should lead to the opposite effect. The coal market is of special relevance as coal is available in many countries and often the first choice to meet energy demand. In this paper we assess possible interactions between climate policies and the global steam coal market. Possible market adjustments between demand regions through market effects are investigated with a numerical model of the global steam coal market: the “COALMOD-World” model. This equilibrium model computes future trade flows, infrastructure investments and prices until 2030. We investigate three specific designs of climate policy: a unilateral European climate policy, an Indonesian export-limiting policy and a fast-roll out of carbon capture and storage (CCS) in the broader context of climate policy and market constraints. We find that market adjustment effects in the coal market can have significant positive and negative impacts on the effectiveness of climate policies.

Suggested Citation

  • Haftendorn, C. & Kemfert, C. & Holz, F., 2012. "What about coal? Interactions between climate policies and the global steam coal market until 2030," Energy Policy, Elsevier, vol. 48(C), pages 274-283.
  • Handle: RePEc:eee:enepol:v:48:y:2012:i:c:p:274-283 DOI: 10.1016/j.enpol.2012.05.032

    Download full text from publisher

    File URL:
    Download Restriction: Full text for ScienceDirect subscribers only

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    1. Demailly, Damien & Quirion, Philippe, 2008. "European Emission Trading Scheme and competitiveness: A case study on the iron and steel industry," Energy Economics, Elsevier, vol. 30(4), pages 2009-2027, July.
    2. Johannes Truby and Moritz Paulus, 2012. "Market Structure Scenarios in International Steam Coal Trade," The Energy Journal, International Association for Energy Economics, vol. 0(Number 3).
    3. Lise, Wietze & Hobbs, Benjamin F. & van Oostvoorn, Frits, 2008. "Natural gas corridors between the EU and its main suppliers: Simulation results with the dynamic GASTALE model," Energy Policy, Elsevier, vol. 36(6), pages 1890-1906, June.
    4. Holz, Franziska & von Hirschhausen, Christian & Kemfert, Claudia, 2008. "A strategic model of European gas supply (GASMOD)," Energy Economics, Elsevier, vol. 30(3), pages 766-788, May.
    5. Hart, Rob & Spiro, Daniel, 2011. "The elephant in Hotelling's room," Energy Policy, Elsevier, vol. 39(12), pages 7834-7838.
    6. Patzek, Tadeusz W. & Croft, Gregory D., 2010. "A global coal production forecast with multi-Hubbert cycle analysis," Energy, Elsevier, vol. 35(8), pages 3109-3122.
    7. Boehringer Christoph & Fischer Carolyn & Rosendahl Knut Einar, 2010. "The Global Effects of Subglobal Climate Policies," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 10(2), pages 1-35, December.
    8. Paulus, Moritz & Trüby, Johannes, 2011. "Coal lumps vs. electrons: How do Chinese bulk energy transport decisions affect the global steam coal market?," Energy Economics, Elsevier, vol. 33(6), pages 1127-1137.
    9. Böhringer, Christoph & Rutherford, Thomas F., 2000. "Decomposing the cost of Kyoto: a global CGE analysis of multilateral policy impacts," ZEW Discussion Papers 00-11, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    10. A. Lans Bovenberg & Lawrence H. Goulder & Derek J. Gurney, 2005. "Efficiency Costs of Meeting Industry-Distributional Constraints Under Environmental Permits and Taxes," RAND Journal of Economics, The RAND Corporation, vol. 36(4), pages 950-970, Winter.
    11. Hans-Werner Sinn, 2008. "Public policies against global warming: a supply side approach," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 15(4), pages 360-394, August.
    12. Gibbins, Jon & Chalmers, Hannah, 2008. "Carbon capture and storage," Energy Policy, Elsevier, vol. 36(12), pages 4317-4322, December.
    13. Pindyck, Robert S., 1981. "Models of resource markets and the explanation of resource price behaviour," Energy Economics, Elsevier, vol. 3(3), pages 130-139, July.
    14. Bohringer, Christoph, 1998. "The synthesis of bottom-up and top-down in energy policy modeling," Energy Economics, Elsevier, vol. 20(3), pages 233-248, June.
    15. Michielsen, T.O., 2011. "Brown Backstops versus the Green Paradox (Revision of CentER DP 2011-076)," Discussion Paper 2011-110, Tilburg University, Center for Economic Research.
    16. Harold Hotelling, 1931. "The Economics of Exhaustible Resources," Journal of Political Economy, University of Chicago Press, vol. 39, pages 137-137.
    17. Lise, Wietze & Hobbs, Benjamin F., 2008. "Future evolution of the liberalised European gas market: Simulation results with a dynamic model," Energy, Elsevier, vol. 33(7), pages 989-1004.
    18. Luthfi Fatah, 2008. "The Impact of Coal Mining on the Economy and Environment of South Kalimantan Province, Indonesia," EEPSEA Research Report rr2008061, Economy and Environment Program for Southeast Asia (EEPSEA), revised Jun 2008.
    19. Clemens Haftendorn & Franziska Holz, 2010. "Modeling and Analysis of the International Steam Coal Trade," The Energy Journal, International Association for Energy Economics, vol. 0(Number 4), pages 205-230.
    20. Daniel Huppmann & Ruud Egging & Franziska Holz & Sophia Rüster & Christian von Hirschhausen & Steven A. Gabriel, 2009. "The World Gas Market in 2030: Development Scenarios Using the World Gas Model," Discussion Papers of DIW Berlin 931, DIW Berlin, German Institute for Economic Research.
    Full references (including those not matched with items on IDEAS)


    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.

    Cited by:

    1. Pangan, Melboy & Mulder, Machiel, 2016. "Influence of Environmental Policy and Market Forces on Coal-fired Power Plants," Research Report 16017-EEF, University of Groningen, Research Institute SOM (Systems, Organisations and Management).
    2. Paulus, Moritz, 2012. "How are investment decisions in the steam coal market affected by demand uncertainty and buyer-side market power?," EWI Working Papers 2012-3, Energiewirtschaftliches Institut an der Universitaet zu Koeln (EWI).
    3. Kim Collins & Roman Mendelevitch, 2015. "Leaving Coal Unburned: Options for Demand-Side and Supply-Side Policies," DIW Roundup: Politik im Fokus 87, DIW Berlin, German Institute for Economic Research.
    4. Rioux, Bertrand & Galkin, Philipp & Murphy, Frederic & Pierru, Axel, 2016. "Economic impacts of debottlenecking congestion in the Chinese coal supply chain," Energy Economics, Elsevier, vol. 60(C), pages 387-399.
    5. Franziska Holz & Clemens Haftendorn & Roman Mendelevitch & Christian von Hirschhausen, 2016. "A Model of the International Steam Coal Market (COALMOD-World)," Data Documentation 85, DIW Berlin, German Institute for Economic Research.
    6. Clemens Haftendorn & Franziska Holz & Claudia Kemfert & Christian von Hirschhausen, 2013. "Global steam coal markets until 2030: perspectives on production, trade and consumption under increasing carbon constraints," Chapters,in: Handbook on Energy and Climate Change, chapter 4, pages 103-122 Edward Elgar Publishing.


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:enepol:v:48:y:2012:i:c:p:274-283. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Dana Niculescu). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.